Chances are you‘ve used a technology touched by billionaire tech investor David Sacks – even if you don‘t know his name. The serial entrepreneur and venture capitalist has played a pivotal, if quieter role in advancing today‘s digital landscape – from popularizing online payments at PayPal to transforming workplace collaboration with Yammer.
Now, Sacks channels his relentless drive into spotting the next big wave of innovation. Will his eye for game-changing founders usher in a new era of revolutionary tech with societal-level impact?
From South African Immigrant to Stanford Standout
Born in 1972 in apartheid-era Cape Town, South Africa, a young Sacks developed grit and worldliness from an early age. His physician father and teacher mother uprooted the family when he was just 5, emigrating to Memphis, Tennessee in search of new opportunity. He embraced the immigrant mentality, studying diligently through an elite university-preparatory education.
Shunning medical school, Sacks attended Stanford University in the early 1990s. He graduated in just three years with a BS in economics, forgoing the school‘s prestigious MBA program. Craving new challenges, he stunned peers by enrolling at the University of Chicago Law School. Sacks earned his JD in 1998 – though he ultimately chose entrepreneurship over law.
The PayPal Rocket Ship: Buckle Up
In 1999, 27-year old Sacks leapt at the chance to join an exciting San Jose startup called PayPal. Launched earlier that year by Harvard grad Peter Thiel and Max Levchin, PayPal aimed to transform online payments using email. The company hustled to stay alive amidst the raging dot-com bubble bursting all around.
As PayPal‘s user base ballooned from under 1 million users to over 28 million in 2 years, Sacks signed on as Chief Operating Officer. He led a viral growth strategy fueled by creative bonuses and ever-improving technology. His success in this role PUT HIM IN THE INNER CIRCLE OF THIS HOT STARTUP ON ITS WAY UP. Working alongside the likes of Elon Musk, Reid Hoffman and Thiel himself, Sacks imbibed the dyspotian yet incisive worldview of this tightknit, brilliant group that became known as the "PayPal Mafia."
In July 2002, the rocket ship PayPal reached terminal velocity – getting acquired by eBay for $1.5 billion. Sacks reportedly made over $50 million personally from PayPal‘s IPO and sale.
Betting on Himself to Strike Gold Again
Flush with cash from the PayPal exit, Sacks initially dabbled as a film producer and author. But the entrepreneurial itch needed scratching. In 2006 he launched his first solo venture, the genealogy website Geni. The company pioneered the novel concept of family trees and ancestry records mixed with social networking. Geni attracted over 100 million profiles within a few years.
Sacks‘ next venture, Yammer, was an even greater success. Yammer positioned itself as the enterprise version of Facebook – reinventing corporate communication with social tools. It garnered millions in funding from top VC firms before being acquired by Microsoft in 2012 for $1.2 billion. The banner exit solidified Sacks as a startup founder with the golden touch.
Investing in Category-Shaping Companies
In 2017 Sacks raised $350 million to found Craft Ventures, an investment firm targeting early-stage startups. Teaming up with partner Bill Lee, a veteran of Silicon Valley‘s early dot-com days, Craft focuses on backing driven, ethical founders tackling complex problems.
Craft‘s strategy has delivered standout returns by identifying companies shaping entirely new categories before the crowd catches on. Their portfolio already includes crypto pioneers Dapper Labs and Solana, healthcare disruptors Forward and Atomic, AI tour-de-force Anthropic, and media/commerce platforms like Cameo and Multi. In 2021 Craft announced a staggering $1 billion second fund to back even bolder bets.
Some of Sacks’ Notable Startup Investments
| Company | Category | Exit Value | Return |
|---|---|---|---|
| Opendoor | iBuying | IPO | 88x |
| Anthropic | AI safety | – | – |
| Cord | SaaS low-code | – | – |
| Multi | ecommerce tools | – | – |
Guiding Principles for Spotting Outsized Potential
So what underlying strategies guide Sacks and the Craft team in their investment decisions? In interviews and writings, several consistent criteria emerge:
- Evaluating founders for hunger, ethics and complementary skill sets – Craft seeks almost missionary-like purpose combined with business savvy chops
- Targeting huge addressable markets ripe for disruption by software – Craft likes platforms bringing digital convenience to dusty old industries
- Focusing on product-driven companies vs marketing-driven – The belief superior technology can trump traditional marketing if far better for customers
- Leveraging his experience scaling companies for operational advice – Sacks enjoys mentoring founders through the trials he’s endured
According to Sacks, Craft Ventures seeks opportunities that could plausibly grow to $10 billion or more in value over the next decade. But such staggering potential requires determined, principled leaders learning from past failures on the path to greatness.
Do you see a common thread? Above all, Sacks values resilience, vision and the courage to stand apart from conventional thinking.
Sparks Fly on Political and Social Commentary
Never one to shy away from sharing his views, Sacks actively comments on politics and current events to his large Twitter following. An unflinching libertarian skeptical of government overreach, he supports conservative causes and candidates while lambasting progressive policies. True to iconoclastic form, this candor has ignited controversy at times.
Sacks faced criticism after mocking Elizabeth Warren’s use of a private jet despite the senator’s calls to tax billionaires more. As an early Bitcoin investor, he also made inflammatory remarks about “dumping” his Solana tokens to harm retail traders – drawing rebuke from supporters before apologizing.
And while Sacks has distanced himself from more extreme positions held in his twenties, he still collaborates with friend Peter Thiel on provocative concepts like “seasteading” – building experimental island cities free from existing laws. Such thought experiments underline his libertarian leanings towards individualism and technology as forces for progress.
The Future His for the Taking
Having conquered business and investing early in life, Sacks enjoys unusual freedom to chart his own course going forward. If past results are any indicator, we can expect more bold investments flowing from his creativity and instincts. Perhaps some will reshape society as profoundly as PayPal and Yammer transformed their corners of the tech landscape.
Of course, with big ambition often arises big controversy for those challenging the status quo. Will the radical ideas Sacks backs prove enlightened predictions or impractical flights of fancy? Either way, his eventful journey continues – with more unexpected twists sure to come.
So what do you think – will another startup backed by David Sacks one day earn a prime spot in the history books? Share your predictions on his future prospects!